sThe economy has gone through its fair share of ebb and flow throughout the past year. Concerns are mounting that the economic consequences of the Federal Reserve’s tight monetary policies might intensify in 2024. Investors hope for a “soft landing” for the United States economy and hope to avoid a severe recession. Although no longer projecting a recession, the Fed foresees reduced economic growth in 2024. In order to keep their portfolio secure, many investors are turning to metaverse stocks.
The U.S. economic outlook improved in 2023, with modest GDP growth of 2.1%. However experts are divided on whether high-interest rates may hinder further growth. Moreover, some predict a shallow recession in 2024, citing slowing wage growth, declining savings and rising household debt. However, this makes it a good time to buy stocks with the potential to change the current technological landscape through new tech. That new tech in question is the metaverse and metaverse stocks.
Autodesk (ADSK)
Autodesk (NASDAQ:ADSK) is a prominent software company known for its expertise in 3D design, engineering and entertainment software. Yahoo! Finance has 22 analysts forecast a high of $270 and a low of $180 with an average of $240.
The global 3D design industry is set to grow significantly, from $3 billion in 2022 to $13.3 billion by 2030 with a strong 20.6% CAGR. Growth factors include a reduction in manufacturing cost and process downtime, government investments in 3D printing projects, and the development of new industrial-grade 3D printing materials.
In Q3 2023, ADSK posted robust financials. Total revenue reached $1.3 billion, up 8% YoY. Technology development, solutions and consultancy hit $714 million. This doubled with a 104% YoY growth. Other services revenue surged to $704 million, marking a tenfold increase. These results highlight ADSK’s strong financial performance and demand response. Q3 financials were strong, with a trailing 12-month revenue of $5.21 billion. This represents an 8.70% year-over-year quarterly revenue growth.
ADSK’s growth strategy centers on end-to-end digital transformation by listening to customers’ needs to integrate real-time, immersive experiences into design and manufacturing processes. Collaborations, such as its partnership with Epic Games, make processes nearly real-time. This enhances efficiency and turnaround times which is unique to ADSK’s software. ADSK’s software can efficiently produce and run 3D drawings performing better than its competition. Autodesk’s commitment to cutting-edge technologies like artificial intelligence (AI) and machine learning (ML) aligns with its vision for end-to-end digital transformation.
Furthermore, ADSK is one of the strong metaverse stocks with healthy financials and robust growth prospects. The 3D design industry’s explosive growth, ADSK’s impressive performance in Q3 2023 and ADSK’s focus on end-to-end digital transformation all showcase its commitment to innovation and efficiency.
Snap Incorporated (SNAP)
Snap Incorporated (NYSE:SNAP) is a world-leading social media company that won best company outlook on employee review platform Comparably in 2023. Yahoo! Finance has 30 analysts predicting a one-year price range on SNAP to be between $6 and $15. This has a mean of $9.68.
The social media platform industry is expected to reach a valuation of $315.8 billion by 2030. This valuation is growing at a 26.2% CAGR. Expected growth comes from the increased adoption of social media in countries with developing economies. India is an example. Rising demand for new camera features to improve content creation will further growth in the industry,
Snap demonstrates healthy financials. For Q3 2023, SNAP reports $1.07 billion in revenue, beating analyst expectations by $7.5 million. SNAP displays strong signs of profitability through a 58.4% gross profit margin. Management exhibits a superior ability to handle operational expenditures through a 10.1% levered FCF margin.
The company is positioned for growth through partnerships and product development that improve user experiences. Snap has partnered with Verizon to provide augmented reality (AR) experiences at concerts by using Snap’s AR mirror. Furthermore, Snap can utilize its AR mirror technology to provide unique concert experiences. This tech will improve the concert experiences for users. Snap has already launched its own AI chatbot My AI. My AI has implementations of generative AI enabling it to send pictures back to users instead of just text. Further implementations of generative AI include the company’s new offering: Snapchat “Dreams.” “Dreams” allows users to incorporate themselves and friends in custom backgrounds.
Regardless, all of these factors make Snap one of the millionaire-making metaverse stocks for investors
Roblox Corporation (RBLX)
Roblox Corporation (NYSE:RBLX) is an industry video game creation platform company with its proprietary games made by developers David Baszucki and Erik Cassel. Yahoo! Finance has 26 analysts predicting a one-year price range on RBLX to be between $18.00 and $60.00, with a mean of $37.01.
The video game development industry is expected to reach a valuation of $757.5 million by 2027, growing at a 14.5% CAGR. Expected growth comes from accelerated development in AR and VR games made possible by technological advancements. The ever-increasing capabilities of graphic processing units (GPUs) and high-speed internet, with 6G on the horizon, are the advancements that catalyze more resource-intensive forms of game development.
Furthremore, Roblox is poised for future growth through partnerships that expand its marketing abilities and expand to new platforms. Roblox has partnered with marketing company Super League to grow the company’s partnerships with influencers for in-game events and create immersive advertisement experiences in its virtual reality games. With Roblox having grown its revenue and user base through its concert experiences in its virtual reality environment, this partnership will improve these experiences for users through immersive advertisement. Roblox is expanding platforms to include the PlayStation console system.
With the video game creation industry on the rise, strong financials, a partnership that improves virtual reality experiences, and an upcoming platform expansion to Playstation, Roblox is a metaverse stock that investors don’t want to miss.
On the date of publication, Michael Que did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
The researchers contributing to this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
